Supreme Court stays arrest of petitioner under GST Act, directs release on bail in the event of arrest
ABCAUS Case Law Citation:
ABCAUS 2741 (2019) (01) SC
The Hon’ble Supreme Court has stayed the arrest of the petitioner under GST Act on the condition that he appears before the Directorate General of GST Intelligence.
The Division Bench while admitting the SLP of the appellant further directed that in the event of his arrest, he shall be released on bail on furnishing satisfactory security.
Earlier, the Hon’ble High Court considering the conduct of the appellant, gravity of the offence and the seriousness of the allegation had refused the pre-arrest bail.
The appellant was the owner/proprietor and as alleged, he by submitting fake invoice/bills/other documents, had availed wrongful Input Tax Credit (ITC) committed cheating and causing loss of approx Rs. 77 crores to the Government Exchequer.
The appellant was prosecuted by the Directorate General of GST (Intelligence) for the offences under Section 132(1)(b) and (c) of CGST Act and the application of the appellant for pre-arrest bail was rejected by the Additional Sessions Judge (ADJ).
The appellant approached the Hon’ble High Court.
The Hon’ble High Court observed that the appellant had caused wrongful loss to the Government Exchequer approximately to the tune of Rs. 77 Crores by wrongfully availing the benefits of ITC and had enriched himself by adopting various illegal methods.
The appellant submitted that the GST Act was a new enactment and various norms were yet to be settled. However, the High Court rejection the plea at the threshold.
The Hon’ble High Court opined that it was true that the GST Act enacted by the Parliament was a new statute, but with an intention to establish easy process of revenue collection. However, some unscrupulous elements in the Society like the appellant by exploiting loopholes in the Act are causing wrongful loss to the Government Exchequer and enriching themselves.
The High Court opined that the custodial interrogation of the appellant was necessary not only to unearth the entire truth behind the present crime, but also to investigate the modus operandi adopted along with other accused persons who were involved in the crime and the same was not possible without there being through interrogation by the Investigating Agency.
The Hon’ble High Court expressed displeasure over the conduct of the Advocate of the appellant
who despite the fact that no interim relief was granted to the appellant in the previous order of the Court, informed the DGGI that the Vacation Bench of Hon’ble Judge had orally directed the Investigating Officer not to arrest the appellant.